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rhino impact Bond changing the conservation landscape

rhino impact Bond changing the conservation landscape. Social Finance is authorized and regulated by the Financial Conduct Authority FCA No: 497568. With thanks to:. the CONSERVATION movement needs to change.

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rhino impact Bond changing the conservation landscape

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  1. rhino impact Bondchanging the conservationlandscape Social Finance is authorized and regulated by the Financial Conduct Authority FCA No: 497568 With thanks to:

  2. the CONSERVATION movement needs to change • Realistic global funding levels needed for protected areas are only 2-4% of global military spending, but many governments is disinvesting in protected areas • Scaling up conservation funding therefore requires • New sources of finance, including harnessing the power of private finance to drive change in approach to conservation. • Implying greater focus on measuring impact.

  3. escalating poaching is leading to a tipping point Number of rhinos poached in Africa • Escalating poaching threatens to push rhino populations over a tipping point. • The Javan rhino recently went extinct in mainland SE Asia, the last individual was poached • Rapid, global response urgently needed. • The growing impact investing market could be a large source of upfront capital to boost site-based rhino conservation. • The project will create a roadmap to reduce poaching, applied first to rhinos, then all high value species. Source: Emslie, R. & Knight, M. 2014. Update on African Rhino Status and Poaching Trends from IUCN SSC African Rhino Specialist Group (AfRSG). Data from IUCN SSC AfRSG, TRAFFIC and CITES Rhino Working Group.

  4. Our Aim is to launch a $40-50m impact bond to conserve rhinos globally Site data provided by IUCN SSC Rhino Specialist Groups

  5. The rhino impact bond in a nutshell Impact bonds are not traditional bonds or trust funds They are equity investments where return is pegged more to social returns than maximum profits The rhino impact bond represents a collaboration between investors and donors, such that investors risk their profits and some of their capital to ensure that donor contributions are only used for successful projects

  6. unique structure of IMPACT bonds lends itself to tackling the poaching problem • Rhino protected areas need: • upfront and sustained funding; • flexibility to change activities as poaching threat changes. • Impact bonds provide: • long-term (c. 10 year) funds; • incentives to achieve impact through linking funding to results; • ‘service providers’ (e.g. PA managers) with flexibility in implementation. Donor paysfor impact achieved, rather than controlling inputs and processes • Investors provide • up-front capital to, and • portfolio manage, • service providers in • real-time • Impact achieved • improves as programme • is adaptive, client-centred • and evidence-based The generic structure of an impact bond

  7. Return on investment will depend on verified success of the portfolio of rhino sites NO IMPACT X Capital is returned + 5-10% IRR ONLY if impact is achieved INVESTORS Return on investment depends on success Upfront capital OUTCOMES FUNDERS RHINO IMPACT PARTNERSHIP Capital is spent on site based actions Portfolio management SITE MANAGERS Site-based actions over 8-10 years RHINO POPULATION DESIRED OUTCOME

  8. Pros and cons For donors Pros Money not wasted on failed projects Someone else providing oversight Cons In the case of a successful project the donor has to pay 5-10% more to provide return on investment For investors Pros Supporting conservation With strong measures attached to help make investment decisions as the project progresses If successful, capital back along with some modest profits Cons Can lose profits, some of capital or at worst all capital Lower profits than traditional investment

  9. project will assess the gaps across rhino sites to provide investors with a clear ‘theory of change’ Theory of change based on holistic PA management framework … … for gap analysis by PA managers… … to produce intervention model, indicators and budget Developing outcomes indicators is a methodological challenge

  10. GEF Project will Prove the concept and build investor confidence over 2 years, to launch bond in 2017 • Activities to design the bond and build investor confidence: • Gap analyses in several priority rhino sites • Test interventions and performance metrics • Aiming to work in: • Asia and Africa (East and Southern) • Focus on Key1-rated rhino populations • Learn lessons for investors

  11. Thank you "Impact Bonds stand to improve the efficiency of development assistance in the coming years“ Elizabeth Littlefield, president of overseas private investment corporation For more information: Katherine Secoy, Zoological Society of London Katherine.Secoy@zsl.org

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